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Avalon rare earths mining operation could be up and running within two years, says president

Avalon Advanced Materials Inc. is ready to start a small-scale mining operation at Nechalacho using new technology, and a new mindset, that its executive thinks might be the future of Northern mining.

"We want to keep it small, simple, get started quickly and enter the market," said Avalon's president and CEO Don Bubar.

As announced last month, Avalon is entering an agreement with Australia’s Cheetah Resources Pty Ltd., which gives Cheetah ownership of the near-surface resources at the T-Zone and Tardiff Zone of the project for $5 million.

Avalon Advanced Materials president and CEO Don Bubar holds a piece of bastnaesite, containing rare earths, from the Nechalacho site, 100 km southeast of Yellowknife. Tim Edwards/NNSL photo

This investment would be enough to get a small-scale mining operation up and running at Nechalacho, 100 km southeast of Yellowknife, to harvest those resources, as early as next year.

Bubar said the ore mined, from the surface, would be processed "dry," which means it would be crushed and fed into a machine that would detect the physical properties of the rare earths it wants, leaving behind sand as a byproduct. That sand could be used for building road infrastructure at the site, he said.

Bubar said going small, to start, would allow the company to make inroads into the rare earths market. The neodymium and praseodymium the mine would produce is in high demand right now to build the magnets needed to construct electric car motors.

The supply still mainly comes from China, and Bubar said Avalon could get in on the ground floor and secure itself a spot in the supply chain.

"If you’re first, you’ve got a lot of advantage," said Bubar.

Then, he would hope to scale the operation up, gradually, to the full-scale mine for which Avalon already has permits and regulatory approvals in place from 2014, before the project was temporarily shelved.

He says this gradual approach would also allow the project to "reclaim as you go" rather than wait until the end for remediation.

Avalon has been in talks with Deton’Cho Corporation about the business opportunities that could come with the project, including catering, labour and contract mining.

Deton’Cho president and CEO Paul Gruner said the company – through its partnerships and subsidiaries – has about 800 people employed at the territory’s diamond mines, 600 of which are NWT residents.

He said projects like Avalon will play an important role in keeping people in the North as the diamond mines wind down.

"I think for the next 10, 15 years, what all of us need to keep our eyes on are things like Giant Mine and the development of infrastructure – that can absorb a lot of the skilled labour," said Gruner. "The Avalons of the world, TerraX, Pine Point – let’s make sure we’re securing our local workforce because once they leave, they don’t come back."

Bubar said the next steps for the project are to finalize the transaction with Cheetah, develop a work program for this year and get ready to make a decision on whether to go ahead in 2020.

While the original, large-scale project is largely permitted, Avalon also needs to make sure the Mackenzie Valley Land and Water Board approves the new incarnation of the project.
Bubar said he believes the new project, especially in its small-scale start, falls well within the original parameters and should have a smaller impact on the land.

"This is kind of the way of the future for the industry," said Bubar, adding that the new technology to be used could make it much easier for homegrown, Indigenous-owned companies to explore and even mine in the North in the future.